Medicaid currently fails at providing a system that efficiently and accurately stores and utilizes member data. As Medicaid is a joint state and federally run program, there are many problems with coordinating data platforms. Different states have their own unique data processing and storing, and while federal Medicaid data can show a clearer picture of consistent issues across state lines, lack of communication and data sharing produces significant barriers. While technology has progressed, holes in existing data or errors in computation have direct consequences to the swift identification of third party liability (TPL), leading to costly reimbursement strategies for Medicaid. The lack of consistency in these systems prevents Medicaid from operating smoothly.

One of the major challenges facing Medicaid is the lack of quality TPL data. In testimony before Congress in 2012, HHS Regional Inspector General Ann Maxwell gave an alarmingly negative assessment regarding the reliability of data federal and state governments use to detect overpayments and fraud in the Medicaid program. She stated, “much of the data used to identify improper payments is not current, available, complete, [or] accurate.” Ten years later, the exact same issues with TPL data that Maxwell outlined in her testimony to congress exist today. Beyond simple mistakes at the point of service with providers, there are fundamental problems in the health care data utilized by the Medicaid program that lead to the loss of literally billions of dollars a year.

State Data Issues

Each state Medicaid agency (SMA) is responsible for delegation of funds and identifying TPL through their own databases. However, states have varying policies and benefits for Medicaid enrollees, producing inconsistent results. State policies may have existing gaps in information or may be so complex that they are almost impossible to navigate, leading to administration frustration. The Medicaid Management Information System (MMIS) works to consolidate information and uses patient identification numbers to help with payment delegation. However, because of the large Medicaid population, along with constant churn, these datasets can be bulky and create missing information that leads to difficult identification of TPL. Furthermore, Medicaid information is not communicated across state lines, producing repetitive errors that could be avoided. Health care organizations may share patient data with Medicaid for payment purposes, but the various types of data management could be an issue when trying to translate to Medicaid-specific forms.

Federal Data Issues

While states may submit regular reports to federal Medicaid agencies, a working federal database may have a hard time deciphering the varying information from different SMAs. Data can be lost, infrequently collected, or incorrect across state lines. A person in one state could move to an adjoining state and lose specific Medicaid benefits. Data might only show a small piece of the big picture and cannot adequately address the nuances of a social program and the problems that persist across states. Federal guidelines may only guide overarching procedures, and not have control over individual states’ Medicaid programs and policies. This disjunction of administration proves difficult when trying to accurately find TPL data for not only individuals, but also states and federal overview.

Data sharing is therefore an efficient and effective way to reduce the number of discrepancies between states and local organizations that require Medicaid payment. However, a slew of issues stem from data sharing in totality. Even within states, health care organizations are reluctant to share patient data. Sacred protected health information (PHI) delegates immense responsibility to hospitals, providers, and care coordinators to handle data cautiously. Even if organizations are willing to share patient data, unique technology systems across health care do not always capture the same data or translate it in the same way. SMAs are responsible to intake this information and identify TPL, which increases difficulty when trying to smooth operations. This reluctance to share information translates to state and federal Medicaid agency issues. Sharing large amounts of diverse data has been troublesome and results in inconsistent data and high costs to the Medicaid program.

For years Medicaid has struggled to effectively store and utilize program beneficiary data due to disparate data platforms and the inability to effectively share Medicaid data between states and the federal government. Furthermore, much of the healthcare data that Medicaid plans do have access to is leading to billions of dollars in improper payments every year. Without reliable, complete, and accurate TPL data, Medicaid plans will continue to make claims payments in error and rely on costly reimbursement strategies. Plan administrators should look to true TPL technology solutions for additional efficiency and cost avoidance opportunities to protect the program’s valuable resources and ensure that plan members receive the care they need.